BT could be forced to break up its Internet broadband business, as Ofcom addresses competition in the sector.

The telecoms company currently has control over the Openreach fibre broadband network. While it is required to provide access to on equal terms to its competitors, Sky has been critical of the service that is provided and has called for a split.

Sharon White, Ofcom chief executive, said: "This review is about ensuring people get the best possible communications services, wherever they live and work.

"Our priorities are clear. We want to promote competition, investment and innovation, so that everyone benefits from even better coverage, choice, price and quality of service in years to come."

A split is far from certain, with other options under consideration including continuing to use the existing model, then applying new rules that would force BT to strengthen it.

Alternatively, it could be deregulated, which would allow for different networks to provide phone and broadband services without having to use BT’s network at all.

Paolo Pescatore, Director, Multiplay and Video, CCS Insight, said: "The big news here is the proposed break-up of BT. Many of its rivals have been lobbying hard for this for some time and they’ve clearly mounted enough pressure to raise concerns. In response, BT has reacted by calling for a detailed review in the pay TV market.

"The major focus of the latest strategic review of the digital communications market is all about how well competition is delivering benefits to consumers and businesses. With this in mind, it seems that a full separation is unlikely as stated by Ofcom. Furthermore, Ofcom has acknowledged that the current system, whereby BT operates Openreach as a separate unit, has provided choice.

"It is especially interesting that Ofcom has chosen to conduct this review as we move towards two major acquisitions that will change the UK multiplay market. Only time will tell, but it is clear that Ofcom is sticking to its guns and we expect a formal conclusion to the review by the end of the year."

It is believed that UK consumers would likely get better services at lower prices if the market has a sufficient number of effective competitors.